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The term “carbon offsets” is sometimes used to describe units of legal entitlement to emit a certain amount of carbon dioxide (CO2) or some other greenhouse gas that are used in emissions trading schemes. Such units are often called “carbon credits.” The term carbon offsets is reserved for voluntary purchases of carbon-reduction services by individuals or corporations for reasons of conscience or public relations.

In the early 2000s, a growing number of high-profile entertainment events were purchasing carbon offsets to cancel their carbon footprint (the amount of carbon released to supply materials, travel, electricity, and the like). For example, some rock bands, such as Pearl Jam and Pink Floyd, stated that they purchased carbon offsets to make their concert events carbon-neutral. Voluntary offsetting is advocated as a way that people can take responsibility for their personal contribution to global climate change, and is sometimes

criticized as a feel-good activity that does little to reduce global climate change.

Historical Background and Scientific Foundations

The concept of voluntarily buying carbon offsets to reduce or cancel the carbon footprint of a business or individual dates to the early 1990s. In 1997, the yogurt company Stonyfield Farm became the first company to state that it had reduced its carbon footprint to zero by purchasing offsets, namely by investing in a tree-planting project in Oregon. Over the next 10 years, the idea gained popularity, until by 2006 there were about 40 retailers of carbon-offset services in Europe, Australia, and North America. In 2006, the New Oxford American Dictionary chose “carbon neutral” as its Word of the Year (even though it was two words).

Increasing public concern about global warming drives the market for carbon offsets. Private individuals or corporate officials may wish to take responsibility for some or all of their own carbon emissions, both direct (from the burning of fuels such as gasoline and heating oil) and indirect (emitted in the process of providing goods and services such as food and telephone service).

The average U.S. resident emits, directly or indirectly, about 21 tons (19 metric tons) of carbon dioxide equivalent (CO2e) per year. “Equivalent” means that the whole amount of greenhouse gases emitted, including at least five gases in addition to carbon dioxide, produces as much global warming as if it consisted of 21 tons of pure carbon dioxide. Driving 1,900 mi (3,060 km) in a mid-sized car or leaving a computer on for 14 months emits 1 ton (0.9 metric ton) of CO2e.

Carbon neutrality from voluntary offsetting has been claimed by American candidates for political office such as Hillary Rodham Clinton and John Edwards; rock bands such as Pearl Jam and Pink Floyd; entertainment events such as the 2007 Live Earth rock-concert benefit event for fighting global climate change; and sporting events such as the 2006 World Cup soccer game and the 2012 Olympic Games in London. The transatlantic airline Silverjet states that it is carbon-neutral, investing US$28 per round-trip ticket into an offset fund that abates as much CO2e as the airline generates for the average ticket, about 1.2 tons (1 metric ton).

Offsetting companies offer to balance carbon emissions generated by individuals or companies by investing in energy conservation, low-carbon energy generation, or carbon sinks, primarily tree-planting.


ADDITIONALITY: The property in a carbon offsetting project, especially as defined by the Kyoto Protocol, that the project would not have been undertaken in any case, regardless of offset goals. For example, a project to burn off landfill methane lacks additionality if the methane would have to be burned off anyway for safety reasons.

CARBON CREDITS: Units of permission or value, similar to monetary units (e.g., dollars, euros) that entitle their owner to emit one metric ton of carbon dioxide into the atmosphere per credit.

CARBON FOOTPRINT: The amount of carbon dioxide (or of any other greenhouse gas, counted in terms of the greenhouse-equivalent amount of CO2) emitted to supply the energy and materials consumed by a person, product, or event. A concert, manufactured object, family, organization, or individual person may all have a carbon footprint. The more carbon is released, the larger the footprint.

CARBON NEUTRALITY: An arrangement by a person or group whereby as much carbon dioxide is being removed from or kept out of the atmosphere as is being released by the activities of that person or group. Carbon neutrality is achieved when offsets equal the person or group's carbon footprint.

CARBON SINKS: Carbon reservoirs such as forests or oceans that take in and store more carbon (carbon sequestration) than they release. Carbon sinks can serve to partially offset greenhouse-gas emissions.

GREENHOUSE GASES: Gases that cause Earth to retain more thermal energy by absorbing infrared light emitted by Earth's surface. The most important greenhouse gases are water vapor, carbon dioxide, methane, nitrous oxide, and various artificial chemicals such as chlorofluorocarbons. All but the latter are naturally occurring, but human activity over the last several centuries has significantly increased the amounts of carbon dioxide, methane, and nitrous oxide in Earth's atmosphere, causing global warming and global climate change.

Impacts and Issues

The methods used by offset companies to reduce greenhouse emissions or absorb carbon from the atmosphere vary in merit and price. Depending on the provider, offsetting 1 ton of carbon costs anywhere from $5 to $25 in 2006. Some offset projects have been criticized as having little greenhouse effect, such as planting trees in temperate zones. Some providers fund projects that were going to be pursued anyway, violating the principle of additionality (i.e., that true offsets must buy reductions that are additional to reductions that would have happened anyway). The result of such measures is that purchasers are cheated: the money they give to ineffective offset sellers does not produce as much CO2e reduction as they are told that it does.

As of 2007, the offsetting industry's biggest lack was uniform standards and verification procedures— binding definitions of exactly what it takes to offset a ton of CO2e and of checking to see that companies are following through on their commitments. Unlike buyers of conventional services and products, buyers of offsetting services normally never see what they are buying; many offset projects are located in developing countries, thousands of miles away from the typical purchaser.

Voluntary offset purchasing has also been criticized as an evasion of the fact that existing consumer lifestyles may simply not be compatible with major reductions in greenhouse gas emissions. Gregg Marland, a fossil-fuel pollution expert at Oak Ridge National Laboratory, was quoted by the Los Angeles Times in 2007 as saying: “If you really believe you're carbon neutral, you're kidding yourself. You can't get out of it that easily.”

However, environmentalists and scientific experts who examined the range of offset services offered by commercial companies in 2006 concluded that authentic, effective offset services could be purchased for prices ranging from $5 to $25 per ton, the average being $10 per ton. At $10 per ton, assuming effective offsets, the average American—one of the heaviest emitters in the world—could offset his or her annual greenhouse emissions for $210 per year. Even at $25 per ton, carbon neutrality could be bought for $525 per person per year.

The environmental group Clean Air/Cool Planet commissioned an independent review of offset companies in 2006 that concluded that at that time, only eight offset providers were selling consistently high-quality offsets. In alphabetical order, these were AgCert/DrivingGreen, atmosfair, CarbonNeutral Company, Climate Care, Climate Trust, co2balance, NativeEnergy, and SustainableTravel/MyClimate.

See Also Carbon Credits; Carbon Footprint; Emissions Trading; Lifestyle Changes.



“Kyoto for Consumers.” Nature 444 (2006): 971.

Revkin, Andrew C. “Climate-Neutral Is Hip, but Is It Green?” The New York Times (April 29, 2007).

Schiermeier, Quirin. “Climate Credits.” Nature 444 (2006): 976–977.

Zarembo, Alan. “Can You Buy a Greener Conscience?” The Los Angeles Times (September 2, 2007).

Web Sites

Trexler Climate and Energy Services. “A Consumer's Guide to Retail Carbon Offset Providers.” Clean Air/Cool Planet, December 2006. <> (accessed November 6, 2007).

Larry Gilman